IVAN ARNOLD, an individual, on behalf of himself and all others similarly situated, Plaintiff-Appellee
HOMEAWAY, INCORPORATED, Defendant-Appellant and DEIRDRE SEIM, Individually, and on behalf of all others similarly situated, Plaintiff-Appellant
HOMEAWAY, INCORPORATED, A Delaware Corporation, Defendant-Appellee
Appeals from the United States District Court for the Western
District of Texas
KING, DENNIS, and COSTA, Circuit Judges.
L. DENNIS, Circuit Judge.
Ivan Arnold and Deirdre Seim filed separate lawsuits against
Defendant HomeAway, Inc. In each case, HomeAway sought to compel
arbitration. Concluding that both Seim and Arnold are bound
to arbitrate threshold arbitrability questions, we REVERSE
the judgment of the district court in Arnold's case and
AFFIRM the judgment in Seim's. We REMAND both cases with
instructions to compel arbitration.
owns and operates several websites that facilitate short-term
"vacation" rentals. HomeAway's sites connect
homeowners and property managers with travelers who book
their properties online. Arnold and Seim are both HomeAway
subscribers who list properties on HomeAway's websites.
filed a putative class-action complaint alleging, chiefly,
that HomeAway's February 2016 imposition of service fees
for travelers was contrary to its prior representations and
resulted in a variety of state-law violations. HomeAway
argues that its April 2016 Terms and Conditions govern
Arnold's action. As relevant here, the April 2016 Terms
contain the following provisions:
Any and all Claims will be resolved by binding
arbitration, rather than in court, except [the user]
may assert Claims on an individual basis in small claims
court if they qualify. This includes any Claims [the user]
assert[s] against [HomeAway], [its] subsidiaries, users or
any companies offering products or services through
[HomeAway] (which are beneficiaries of this arbitration
agreement). This also includes any Claims that arose before
[the user] accepted these Terms, regardless of whether prior
versions of the Terms required arbitration.
There is no judge or jury in arbitration, and court
review of an arbitration award is limited. However, an
arbitrator can award on an individual basis the same damages
and relief as a court (including statutory damages,
attorneys' fees and costs), and must
follow and enforce these Terms as a court would.
Arbitrations will be conducted by the American Arbitration
Association (AAA) under its rules, including the AAA Consumer
moved to compel arbitration in reliance on these provisions.
HomeAway argued that, pursuant to the April 2016 Terms and
the AAA Rules referenced therein, the parties had agreed to
arbitrate threshold questions including "the existence,
scope, or validity of the arbitration agreement." Arnold
opposed the motion to compel, arguing that the September 2015
Terms and Conditions, which do not contain arbitration
requirements, governed. He also claimed that, even if the
April 2016 Terms applied, HomeAway's authority to modify
any terms or conditions without providing notice rendered the
arbitration provision illusory and unenforceable under Texas
district court denied HomeAway's motion to compel
arbitration. The court found that the April 2016 Terms
applied because Arnold renewed a subscription for one of his
HomeAway accounts in May 2016. However, the court held that,
under Texas law, the arbitration provision was illusory
because HomeAway had reserved the unilateral right to avoid
arbitration at any point without notice. The court did not
address HomeAway's contention that the April 2016 Terms
contained a delegation clause requiring Arnold to arbitrate
threshold questions regarding the arbitration provision.
HomeAway filed a timely notice of appeal, as is authorized by
the Federal Arbitration Act (FAA). See 9 U.S.C.
it resulted in a different outcome, the history of Seim's
case is substantially similar. Seim also challenges
HomeAway's imposition of traveler fees. HomeAway moved to
compel arbitration under the February 2016 Terms and
Conditions, which contained the same arbitration provision
the April 2016 Terms did. As in Arnold's case, the
district court did not address HomeAway's contention that
a purported delegation clause required Seim to arbitrate
threshold questions about the arbitration provision. However,
the district court, applying Kentucky law, granted
HomeAway's motion to compel arbitration. The court
concluded that when Seim renewed a subscription for one of
her properties and agreed to the February 2016 Terms, ...